What does China want from CPEC?

[MultaniGuy]

The Chinese want their fair share of their investment obviously.

 

[Cybernetics]

How is any of this relevant for Pakistan and its relationship with China? Because CPEC is not the result of the supposed friendship between Islamabad and Beijing, but rather the global chess match that China is playing against the United States.

In this game, if the chess metaphor can be extended, Pakistan is at best a knight: maybe not quite a pawn, but an odd piece that moves even more oddly, and while it can occasionally deliver a good blow here and there, is usually only slightly less expendable than a pawn.

Chess is a Western strategic thought process, at least it is often referenced in the media but is misleading to the public. Chinese think in terms of Weiqi or Go. The game does not depict a showdown (like in Chess) where set number of assets are lost through attrition until capitulation. The analogy regarding Pakistan is totally off, even in the context of pure geopolitics. To expend a nation in a showdown would imply the destruction of that nation to achieve some aim, maneuvering or taking of opponent's piece(s). A weiqi type of thinking would be along the lines of constricting opposing pieces to turn it into one of your own or your own space of operation. No showdown or attrition is explicitly necessary, it depicts a process of growth and development not attrition.

The problem, of course, is that two major global powers building large military installations in close proximity to each other is a recipe for disaster. Beijing may as well be issuing an overt declaration of war.

That is quite the stretch. Military installations in close proximity to each other is not similar to an overt declaration of war. China has vital interests to protect in other nations and along lanes of communications. Its interests lies in protecting those passages and interests, not initiating a showdown with Washington. Close proximity would compel the two nations to workout a structure to avoid conflict, much like how MAD reduced chance of a major war along with greater trust building channels. Tension will always be there, its natural and necessary for security.

Well, for one thing, it may be instructive to remember that this infrastructure is being built first and foremost for the needs of China. Any benefit that accrues to the Pakistani economy is purely incidental and not at all the goal of the projects. And secondly, and perhaps most importantly, it is highly relevant to remember the differences between how the United States and China have historically seen trade.

The most talked about aspects of CPEC such as roads and ports are only a small portion of the initiative. The major component is energy.

Most of the CPEC spending is on energy projects that have no direct utility for the Chinese nation but is necessary and beneficial for Pakistan. Energy infrastructure is badly needed in Pakistan. One can argue that it benefits Chinese industries offshoring to Pakistan but without energy infrastructure, offshoring wouldn't go to Pakistan but to other regional nations. With these energy projects, Pakistan would be attractive to foreign investment from all nations, especially in manufacturing sector. It would also benefit domestic industries, making them more competitive.

Roadways being built in Pakistan directly benefits Pakistanis. Yes, it also benefits China for its other projects in Pakistan but Pakistanis sees the most direct benefit. The author is like arguing China's infrastructure construction in China is built foremost for the needs of America to facilitate exports to the US and for American FDI. While in reality Chinese sees the most direct benefits and sees a multiplier effect upon the economy even though some Chinese highways were foreign financed early on.

In my view, CPEC will bring immense long lasting benefits for Pakistan as well as China.

 

[Indus Pakistan]

Because CPEC is not the result of the supposed friendship between Islamabad and Beijing

A very dumb comment by the author who uses terms like 'intellectual'. The author should know that the discussion here does not relate to two chums being mates. This relates to two states which are not living individuals. When we use the word "friendship" between countries we mean the convergence of interests they share. On the other scale enemies means extreme divergence of interests.

increase the centrality of China in global trade.

This is what drives CPEC. But this suits Pakistan fine. As China moves forward to take dominant position in the global order Pakistan can find convergence. Meaning Pakistan can leverage this to gain a position as a ally in the Chinese scheme. Much as Western Europe, Turkey, Japan, South Korea, Australia have found themselves niches in the US dominated world order. Similary Pakistan can find a niche in the Chinese ambition to establish a new order. CPEC is a step in that direction.

Now the question is this. As the author states clearly that China is driven to achieve global centrality does it mean this can be better achieved by destroying Pakistan? The fact is most of the world is aligned with USA. China is the rising order and does nit have many countries that it can call allies. One of the few is Pakistan. Just like USA made sure that Western Europe rose, so did Japan because all these countries aggregated US power. If you have strong allues under you it makes your order stronger. If you have weak allies it can be a liability.

So question here is this. As China rises would it want Pakistan down the road to be a powerful, prosperous country that is a huge market as a ally or a ally that has imploded? To put it in perspective does it suit USA to have a prosperous Japan and Western Europe or not? If Pakistan does well it would offer huge market to China as well as a solid strategic ally. Bottom line as China it makes perfect sense for Beijing to lift it's ally so that it can be win win for both.

Chinese think in terms of Weiqi or Go. The game does not depict a showdown (like in Chess) where set number of assets are lost through attrition until capitulation.

This a very interesting. I did not know about this. Thanks for educating us on this. I will read more on this to get full understanding of this "Go" concept.

 

[Hakikat ve Hikmet]

Look below.

Gangaism Pronounciation ganga/is/m.

The unique way of thinking and stupidity that is often found in India.

According to even some serious Indian thinkers, guys behind the creation of Pak had a much greater strategic mindset than the guys behind accepting the partition...

 

[zip]

China is a manufacturing giant , it wants customer for its goods , that doesn't mean it will uplift customer economically and then sell their goods to them ..Expecting anything from powerful countries has its own risk of surrendering sovereignty on many issues ..Pakistan will benefit from Chinese proximity only if it plays it's card well .In case of cpec it was not the case ..

 

[Pakistani Aircraft]

Another propaganda article.

People mustn't forget that it was Pakistan in the mid 90s that offered this route to the Chinese.

China only accepted this route after a decade when the US decided to move big chunk of of its navy to the South China Sea as part of their "Pivot to Asia" policy.

What Pakistan also wants (quietly) from this CPEC project is permanent Chinese Naval and Airbases in Southern Pakistan so it can concentrate on developing its economy instead of spending everything on its security.

 

[Indus Pakistan]

In case of cpec it was not the case ..

How so?

 

[zip]

How so?

If we want a road to our north east state through Bangladesh what will Bangladesh say ? Though it's a friendly state it will make us to invest all the money for construction of the road and over that it may tell us to pay some tax for land it provided .
In cpec case though one belt one road is Chinese ambitious project and especially cpec is very important in emergency situation it's Pakistani tax payer who is paying for construction .Do you think those roads are urgent necessity for Pakistani goods transportation ?

 

[Indus Pakistan]

Do you think those roads are urgent necessity for Pakistani goods transportation ?

Yes. Very much so. And just for the record only about 20% is going on roads. The biggest chunk has gone on power plants. I am sure you have heard about the crippling load shedding Pakistan has suffered in last few years.

And for the record as regards roads. Pakistan is a narrow elongated country running on a north south axis with Indus River forming the spine. Most of the population lives in the northern half. Meaning it is far away from the sea. At present just one major road built during British times links the entire north south spine terminating at the port of Karachi. Although that road has been improved but as it goes south through hundreds of villages, towns, cities along it's 1,000 mile journey it is clogged with truck traffic. This means exra costs to industry and trade.

Under CPEC the entire length of this 1,000 miles spine is recieving a six lane motorway which is access controlled with tolls. This will mean north now can get connected with the port in Karachi via a efficient transport corridor saving costs and time.

Have a look at the map below. As far back as 1990s Pakistan built a west-east motorway network begining near the Afghan border at Peshawar to Islamabad to Lahore [green] on the Indian border. However what was needed badly was a north-south link to connect with the port at Karachi. Because of funding issues only a small spur had been built upto Faisalabad. Under the CPEC the entire length [red] is almost completed and will open fully by 2019. This will connect almost every major city to the port. How is this bad for Pakistan? It will bring a revolution as it will enable the entire country to have efficient link with the port.

In addition another route is being built [black] which will run on the western spine throught underdeveloped regions which will terminate at Gwadar bring a revolution to those districts along it's route. The upper section is almost completed but rest is a long term project. Now tell me how is this bad for Pakistan? And note again the road component in CPEC is just over 20%. Rest is on power plants, ports etc

Having a world class west-east transport corridor and another north-south corridor connecting every major city can only be good for the economy. How is that bad for Pakistan?

And these are all toll motorways.

 

[zip]

Yes. Very much so. And just for the record only about 20% is going on roads. The biggest chunk has gone on power plants. I am sure you have heard about the crippling load shedding Pakistan has suffered in last few years.

And for the record as regards roads. Pakistan is a narrow elongated country running on a north south axis with Indus River forming the spine. Most of the population lives in the northern half. Meaning it is far away from the sea. At present just one major road built during British times links the entire north south spine terminating at the port of Karachi. Although that road has been improved but as it goes south through hundreds of villages, towns, cities along it's 1,000 mile journey it is clogged with truck traffic. This means exra costs to industry and trade.

Under CPEC the entire length of this 1,000 miles spine is recieving a six lane motorway which is access controlled with tolls. This will mean north now can get connected with the port in Karachi via a efficient transport corridor saving costs and time.

Have a look at the map below. As far back as 1990s Pakistan built a west-east motorway network begining near the Afghan border at Peshawar to Islamabad to Lahore [green] on the Indian border. However what was needed badly was a north-south link to connect with the port at Karachi. Because of funding issues only a small spur had been built upto Faisalabad. Under the CPEC the entire length [red] is almost completed and will open fully by 2019. This will connect almost every major city to the port. How is this bad for Pakistan? It will bring a revolution as it will enable the entire country to have efficient link with the port.

In addition another route is being built [black] which will run on the western spine throught underdeveloped regions which will terminate at Gwadar bring a revolution to those districts along it's route. The upper section is almost completed but rest is a long term project. Now tell me how is this bad for Pakistan? And note again the road component in CPEC is just over 20%. Rest is on power plants, ports etc

Having a world class west-east transport corridor and another north-south corridor connecting every major city can only be good for the economy. How is that bad for Pakistan?

And these are all toll motorways.

I don't want to be pessimistic in this story but these are small steps for a nation and need careful attention so that if any mistakes happened should not be repeated in future .
In our state Karnataka govt called for bids in solar project in govt land ..Bidder has to quote per unit electricity cost company wants from govt.
Minimum bid was 2.4rs per unit .
Here land is provided by govt ,company has to invest on solar park and should provide electricity to electricity board .
See the cost of per unit electricity without any pollusion and govt investment .Now compare it with per unit charge under cpec after all those investment .I am not saying govt have any notorious plan or something but companies are there for profit making ,they will do what is good for them .

 

[Hakikat ve Hikmet]

Yes. Very much so. And just for the record only about 20% is going on roads. The biggest chunk has gone on power plants. I am sure you have heard about the crippling load shedding Pakistan has suffered in last few years.

And for the record as regards roads. Pakistan is a narrow elongated country running on a north south axis with Indus River forming the spine. Most of the population lives in the northern half. Meaning it is far away from the sea. At present just one major road built during British times links the entire north south spine terminating at the port of Karachi. Although that road has been improved but as it goes south through hundreds of villages, towns, cities along it's 1,000 mile journey it is clogged with truck traffic. This means exra costs to industry and trade.

Under CPEC the entire length of this 1,000 miles spine is recieving a six lane motorway which is access controlled with tolls. This will mean north now can get connected with the port in Karachi via a efficient transport corridor saving costs and time.

Have a look at the map below. As far back as 1990s Pakistan built a west-east motorway network begining near the Afghan border at Peshawar to Islamabad to Lahore [green] on the Indian border. However what was needed badly was a north-south link to connect with the port at Karachi. Because of funding issues only a small spur had been built upto Faisalabad. Under the CPEC the entire length [red] is almost completed and will open fully by 2019. This will connect almost every major city to the port. How is this bad for Pakistan? It will bring a revolution as it will enable the entire country to have efficient link with the port.

In addition another route is being built [black] which will run on the western spine throught underdeveloped regions which will terminate at Gwadar bring a revolution to those districts along it's route. The upper section is almost completed but rest is a long term project. Now tell me how is this bad for Pakistan? And note again the road component in CPEC is just over 20%. Rest is on power plants, ports etc

Having a world class west-east transport corridor and another north-south corridor connecting every major city can only be good for the economy. How is that bad for Pakistan?

And these are all toll motorways.

A very nice explanation!!! Anything good for Pak is bad for India; hence the demagogues from the Book of Iblis!!!! Does it take a Jinnah to fathom it ??!?!!

CPEC is not "economical"; sea transport is cheaper than land transport so China's exporters will find it makes much more sense to continue shipping through China's own ports rather than railroading them westwards.

I do not think China is interested in "developing its Western part" for export purposes through CPEC. What do you think the deserts of Xinjiang produce that China is interested in exporting through Pakistan, rather than through Central Asia or using for its own consumption? Fish? Oil?

And in case of dispute, why would Chinese exporters wish to deal with Pakistan's court system? Pakistani negotiators propose arbitration must take place in Pakistan itself, which makes dispute-resolution subject to all kinds of possible one-sided tricks: link

IMO, most likely the Chinese desire is strategic: the Chinese remember what happened in WWII when they were cutoff from foreign supplies, save for the Allied airlift. Although no prospect of such is on the horizon, they don't want even the possibility of it happening ever again. So they not only want CPEC but effective control of it as well through colonization.

For these reasons I don't think the Chinese are especially concerned about the economic success of CPEC. I expect that once completed CPEC will be something of a let-down for Pakistanis: the increase in Pakistan-benefiting trade will be far smaller than Pakistani expectations and the completed project will seed few opportunities for additional capital investment in Pakistan.

If Beni Israil is against CPEC, InshAllah it will be a success....

 

[GeraltofRivia]

So question here is this. As China rises would it want Pakistan down the road to be a powerful, prosperous country that is a huge market as a ally or a ally that has imploded? To put it in perspective does it suit USA to have a prosperous Japan and Western Europe or not? If Pakistan does well it would offer huge market to China as well as a solid strategic ally. Bottom line as China it makes perfect sense for Beijing to lift it's ally so that it can be win win for both.

Well put. What China is looking to achieve in Pakistan via CPEC is exactly the same as what US was trying to achieve in the post war Europe via Marshall Plan- to make Pakistan an economically strong ally through aggressive investment.

Some comments have mentioned the move is strategic but failed to recognize that it is more than just having an alternative trading path. There is no better strategic play than helping your ally building strong economy. Just imagine how much trade can be done between China and Pakistan when its average GDP per capital reaches middle income level. China will not need to be dependent on Europe as much in terms of trade when you have a large and prosperous economy in Pakistan at China’s neighborhood. That is what is considered “strategic”.

 

[Dalai Lama]

Well put. What China is looking to achieve in Pakistan via CPEC is exactly the same as what US was trying to achieve in the post war Europe via Marshall Plan- to make Pakistan an economically strong ally through aggressive investment.

Some comments have mentioned the move is strategic but failed to recognize that it is more than just having an alternative trading path. There is no better strategic play than helping your ally building strong economy. Just imagine how much trade can be done between China and Pakistan when its average GDP per capital reaches middle income level. China will not need to be dependent on Europe as much in terms of trade when you have a large and prosperous economy in Pakistan at China’s neighborhood. That is what is considered “strategic”.

Good point but there are many middle and high income nations already in China's immediate neighbourhood such as South Korea and Japan. Countries such as Vietnam and the Philippines offer safer investment opportunities to Beijing not to mention all these nations are geographically closer to dense population centres of China. Europe offers a larger and wealthier market but is geographically inaccessible by land due to West Chinese terrain and a set of landlocked Central Asian states with unstable economies.

Washington has Beijing confined to what Beijing considers it's backyard in the East by fostering strong strategic ties with East Asian nations, reinforced by Beijing's frankly immature posture in the South China Sea which leaves Beijing restricted to trading with The United States of America and the EU through trans Pacific and Asia Pacific trade routes. Islamabad's ties with Washington have soured drastically over the last decade due to disagreements over internal conflict and the global war on terror. This affords Beijing the opportunity to cement it's strategic alliance with Pakistan.

Pakistan is unique as it offers a warm water port with easier access to fossil fuels, an alternative trade route in case of unfavourable contingency and the possibility of threatening confinement to India; a country with a growing economy and a large population in a world with limited resources. One of the drawbacks however is that goods will have to travel long distances by road which makes it economically impractical for such use. It can still serve as a secondary route of access to fossil fuels but developed and developing countries are increasingly investing more in alternative sources of energy which makes it a venture of diminishing value. The last possibility of Gwadar serving as a naval base is plausible as Islamabad becomes ever more dependant on Beijing for economical stability. The drawback to this however is the threat posed by the US Naval Base of Diego Garcia, further strengthening of strategic ties between Washington and New Delhi and additional militarisation of the Arabian Sea and Persian Gulf.

A note I'd like to add is that geo-political manoeuvring is rarely influenced by possibilities but rather on current realities.

 

[GeraltofRivia]

Good point but there are many middle and high income nations already in China's immediate neighbourhood such as South Korea and Japan. Countries such as Vietnam and the Philippines offer safer investment opportunities to Beijing. All these nations are geographically closer to dense population centres of China. Europe offers a larger and wealthier market but is geographically inaccessible by land due to West Chinese terrain and a set of landlocked Central Asian states with unstable economies.

Washington has Beijing confined to what Beijing considers it's backyard in the East by fostering strong strategic ties with East Asian nations, reinforced by Beijing's frankly immature posture in the South China Sea. This leaves Beijing restricted to trading with The United States of America and the EU through trans Pacific and Asia Pacific trade routes. Islamabad's ties with Washington have soured drastically over the last decade due to disagreements over internal conflict and the global war on terror. This affords Beijing the opportunity to cement it's strategic alliance with Pakistan.

Pakistan is unique as it offers a warm water port with easier access to fossil fuels, an alternative trade route in case of unfavourable contingency and the possibility of threatening confinement to India; a country with a growing economy and a large population in a world with limited resources. One of the drawbacks however is that goods will have to travel long distances by road which makes it economically impractical for such use. It can still serve as a secondary route of access to fossil fuels but developed and developing countries are increasingly investing more in alternative sources of energy which makes it a diminishing investment. The last possibility of Gwadar serving as a naval base is plausible as Islamabad becomes ever more dependant on Beijing for economical stability. The drawback to this however is the threat posed by the US Naval Base of Diego Garcia, further strengthening of strategic ties between Washington and New Delhi and additional militarisation of the Arabian Sea and Persian Gulf.

A note I'd like to add is that geo-political manoeuvring is rarely influenced by possibilities but rather on current realities.

How unfortunate you are still limited by the notion that it is just a trade route. You may struggle to see it but it is understandable.

With regards to investment in other eastern Asian countries, some of them may offer better short term returns but what China is looking for is far beyond the short term gains. What China is trying to achieve is strategic, long term (read half to one century) and mutual economical benefits sharing with its key allies. If China can help lift GDP per capita of Pakistan to the same level, the trading opportunity and economical benefits will simply be gigantic.

 

[Indus Pakistan]

Good point but there are many middle and high income nations already in China's immediate neighbourhood such as South Korea and Japan. Countries such as Vietnam and the Philippines offer safer investment opportunities to Beijing.

Yes there are but all of these are firmly anchored with the US orbit. Pakistan on the other hand represents a solid ally since 1950s. If Pakistan can rise it is win win for both China and Pakistan. Italy and Greece are on another continent from USA but they recieved considerable help by USA post war, Washington nurtured these countries to be part of the new US world order. America is a superpower exactly because it has strong allies across the globe.

Furthermore although Pakistan might be some distence from China's coastel cities but it is adjacent to the Chinese far west. This region will need to get developed and Pakistan will fit into scheme very well. CPEC connects with Chinese Sinkiang.

Pakistan is unique as it offers a warm water port with easier access to fossil fuels, an alternative trade route in case of unfavourable contingency and the possibility of threatening confinement to India;

This is where you are wrong. If you read @Cybernetics post Chinese thinking is long term and does not think in terms of win/loss. Your thinking is based on the present reality and as such myopic. All you can think of is "access" and "contingency" because you can't look beyond today.

How about opening your mind and thinking bigger and over the horizon. Pakistan is a 200 milion country. If China helps it to stand up down the road it could be a vast market with huge trading potential via the CPEC with China. This would represent the emergence of a new trading corridor which then could multiply by linking up with Iran and other Persian Gulf, Arabian Sea and markets furher afield. If you read the OP it talked about Chinese wish not to challange the present trading order built under US purview but build up new route. This is where the OBOR comes in. What I find is most Indian's because of the rivalry cannot think of Pakistan in such terms and can instead either see it as a "access" alleyway or "contingency". Not as a possible quality in it's own right.

A note I'd like to add is that geo-political manoeuvring is rarely influenced by possibilities but rather on current realities.

Not quite. They are based on what is reasonably expected and to a degree there is element if gambling. Those who get it right do well.

Finally the more the USA pushes to be a strategic partner with India the more the Chinese will push for Pakistan. The more the Pakistan and Chinese confluence rises the more the USA will invest in India. Both are being 'groomed' by these giants; contrary to what peole might say here both have taken this opportunity with both hands. There are differances between both dynamics. USA is a superpower at it's apex and on the other side of the world. China on the other hand is rising power and adjacent to Pakistan. Pakistan is better placed to benefit from this emerging world order.

Being smaller it can rise faster in the Chinese wake and being closer enjoy greater synergy. The only potential spoiler is how well Islamabad elites rise to this challange.

How unfortunate you are still limited by the notion that it is just a trade route. You may struggle to see it but it is understandable.

This is exactly what came to my mind. The reason is hatred can be so intense that it can blind people. Such thinking can only think of Pakistan as a "door mat" or a "contingency ladder". They overlook the vast potential of Pakistan itself. Just to give you one idea. Pakistan has one of the largest irrigated systems on earth but agriculture is performing poorly. The other day I read a article about Chinese hybrid wheat which has shown great results in Pakistan. If modern technology and better use of irrigation become widespread in Pakistan the country could see massive increase in agriculture productivity. New crops like olive oil are showing enormous potential.

The Indus region in antiquity was a rich source of agriculture and wealth. We know from Achaemenid Persian records that Indus region contributed huge amount of taxes to the royal treasury at Persepolis. There is no reason Pakistan cannot repeat the past greatness of this region. Indeed there are deep historical ties between China and Pakistan. Just on the suburbs of the modern capital Pakistan, Islamabad is the ancient site of Taxila. In ancient times Taxila was one of the world's earliest universities. Students came from far and wide. It was from here that Greek and Chinese travellers brought and exchanged ideas. Buddhism in fact moved from Taxila north along the Silk Road into China.

Today Taxila is the start point of the Hazara Expressway which heads north to link up with Karakorum Highway terminating in China. This is the modern iteration of the ancient Silk Road and one of the legs of CPEC. We hope new ideas will flow south into Pakistan from the remarkable Chinese experiance in the last three decades.